January 2023 marks a decade since the Public Services (Social Value) Act came into force, pushing those that are commissioning public services to consider the wider social, economic, and environmental impacts of their choices. Since then, the profile of social value has been on the rise and is now a widely recognised term across many industries. Mariefi Kamizouli, Principal Economist at Loop, examines the social value journey to date — and why it’s more important than ever for all types of organisations.
First, it’s crucial to understand just why social value is important. Social Value UK defines social value as ‘the quantification of the relative importance that people place on the change they experience in their lives’, which can include social, environmental, and economic impacts — both positive and negative. Another key factor is recognising that those end-results, and the way they should be captured, will vary based on the needs and context of different scenarios or individuals, so it is important to tailor the measurement as much as possible based on the available research and data.
Therefore, social value provides a way to understand, and ultimately improve, the impacts on individual and community wellbeing. Being able to robustly measure this is key and is why it is so important that measurement frameworks, such as the National Social Value Standard are in place.
Where are we now?
Given the Social Value Act’s directive was to ‘consider’ the wider affect it could have for the good of organisations, communities, and individuals, it unfortunately hasn’t had the transformative impact that was intended. The general consensus being that the Act had somewhat of a slow start, with some social value commitments considered more of a tick box exercise.
However, there have been a lot of positive developments over the past 10 years in this space. Among them are the Procurement Reform Act (Scotland), the Well-being of Future Generations Act (Wales), the UN Sustainable Development Goals, the creation of social value specialist organisations such as Loop, the Construction Playbook, the Social Value Model (and the NHS version), the HM Treasury Green Book wellbeing supplement, and further government procurement policy notes.
With the mandatory scoring of social value in procurement bought in by the Social Value Model and many local authorities having a particular impact.
Alongside a clear shift in societal attitudes post-pandemic and the climate emergency continuing to worsen social value has built significant momentum. Indeed, Google searches for the term have continued to rise year on year, more than doubling in number in the past five years alone. This growing focus from all types of stakeholders means that organisations need new and better ways to evidence and improve what they are doing — and need to communicate it all clearly.
This can be seen across all industries. For example, the construction industry is one of the most progressive when it comes to social value and understanding its importance. But even here, there is work to be done on measurement and reporting, as well as looking beyond just job creation or local budget spend. Not all things can be measured easily or robustly so it’s important for organisations to engage with social value experts to make sure they can evidence the good they create.
A clear example of this was the Tigers Sport and Education Trust in Hull, which was looking to demonstrate the social value of its football programmes. The outcomes went far beyond simple job creation to also look at improved physical and mental wellbeing for the young people taking part. With many of these ‘softer’ impacts playing directly into the missions laid out in the Government’s Levelling Up Whitepaper.
Looking ahead
The next step in encouraging further uptake of social value is not just raising awareness but encouraging a real understanding of its value. It’s an incredibly wide-ranging topic, which is again where specialist software and consultants like at the Loop team come in to help organisations tailor their measurement to their operations and ensure things are done in a robust manner.
As is often the case, we must improve collaboration across industries. This must include all types of organisations from across the public and private sectors, encapsulating SMEs, larger businesses, and non-profits to bring together the best and drive innovation.
Data and technology have previously lacked in the social value space, meaning a lot of spreadsheets and the burden of heavy admin. Plus, the associated higher risks and barriers to entry in terms of time, resource, and knowledge. Software solutions like our own at Loop are now available to do the heavy lifting, making social value not just more appealing but accessible to more organisations, particularly SMEs and non-profits.
The use of technology and data coupled with cross-industry collaboration will naturally breed a better understanding of social value in general. While we have seen instances of people making decisions and applying rules that they don’t fully grasp, it’s easy to understand why this happens with the maturing and ever-evolving world of social value.
That understanding is not helped by the huge number of social value definitions in circulation, with differences ranging from terminology through to fundamental theory. For example, the Green Business Council’s (GBC) framework for defining social value in the built environment listed 24 well-established social value definitions in 2021 alone. With this not including additional definitions on overlapping areas such as sustainability, CSR, or the UN Sustainable Development Goals to name a few.
This reflects how social value is continuing to evolve, with a growing number of frameworks and approaches, which has bred confusion. It has also flooded the space with buzzwords and the aforementioned broader areas of ESG, sustainability and CSR, which can be confusing without standardisation to support measurement and reporting.
We must examine commitments and accountability, which to date have lacked in tracking and monitoring. People expect more from organisations than ever before when it comes to the good that they do, and this will only continue to grow in the future. Whether it’s a broad social value commitment, or more specific goals that fall within the social value sphere, organisations will be expected to evidence their efforts.
But, if negative impacts are not measured along with the positive, or there is no accountability when commitments aren’t met, then these will be deemed empty promises — a cycle we have seen previously on key matters with arguments of ‘greenwashing’ or ‘impact-washing’ for example.
Standardised measurements combined with the tools — aka frameworks and software — to follow things through will be a big next step on the journey, making sure that organisations are detailing what they do and what that means for society. Crucially, these tools will allow accountability for actions and commitments, making sure that organisations are held to high standards in their actions.
People from all walks of life talk about creating a better, fairer, greener society — and social value will help us chart that direction. Loop’s mission is to help organisations understand social value, measure the good they do, continually improve and make a real difference to real people — and are on hand with the expertise, consultancy and software to equip any business on their ongoing social value journey.
For more information, please visit https://www.loop.org.uk/
